What Governments Do and Why

By Anjum Altaf

A seminal book of the 20th century, at least for academics, was An Economic Theory of Democracy, published in 1957. In it, Anthony Downs applied economic theory to the study of politics and, among other things, inferred what a rational government would do given its incentives.

At its simplest, the theory claims that a government aims to stay in power and therefore, if it is democratic, adapts its policies and actions to appeal to a majority of the electorate. For example, in the current run up to the elections in India, the general wisdom is that the ruling party would spend extensively in rural areas to negate a likely swing to the opposition in urban ones. (Contrary to Downs’ prototype, though, it seems it is not the effectiveness of expenditures that matters most to voter sentiment in India – it is the courting that is important.)

Incentives are the key variable in Downs’ proposition and in normal circumstances a government’s incentives are aligned with the objective of retaining power. Having observed Pakistani politics for decades, however, a circle of friends has inferred a variation that might better explain outcomes in the country. It might also illustrate the nature of the gulf that has opened up between the politics of India and Pakistan.

The essence of the variation is that the incentive of a typical Pakistani civil government (as a whole, not of rogue individuals within it which is a more universal phenomenon) has not been re-election but the maximum accumulation of wealth during any period in which it is in office. For one, the duration of its rule in any given period was highly uncertain given that real power was wielded behind the scene by actors other than itself. Therefore a strategy to satisfy the wants of any part of the electorate might yield no returns whatsoever. For another, it knew, given the paucity of political alternatives, that in the merry-go-round of Pakistani politics its turn would eventually come again. Thus it made strategic sense to build up a war chest to sustain it during its period in wilderness and be available when re-entry appeared possible.

This strategy was abetted by globalization when virtually all Pakistani leaders arranged safe havens abroad to recuperate when out of power or to which to escape when things got hot. Some are foreign nationals ruling by proxy from abroad; others shift abodes as and when the situation demands.

One consequence of the safe havens was that the leaders parked all their capital assets abroad and retained just running expenses in local currency. The operating game plan was then entirely tactical and risk-free – to do whatever was needed to extend their resource-extracting rule in the short term till such time when the music stopped. At that moment, they could take flight literally with the clothes on their backs and await some patron or the other to engineer their return.

With such incentives there was little need or time to do anything for the electorate barring the incidental byproducts of the process of making money (large infrastructure or service contracts, for example). This was quite unlike India where electoral strategy demanded the amelioration of some constituency at the very least. Governments could guess wrong (as with the Shining India strategy) but none could afford to ignore all the constituents all the time.

The complete apathy towards citizen needs in Pakistan is plausible in this perspective. A victim is the democratic process itself. Unlike in India, the real opposition is no longer represented by alternate political parties but increasingly by groups that reject the worldview of electoral politics altogether. The rejection also removes compunctions about the destructive economic consequences of their actions. They can survive on the bare minimum and believe everyone should too till the desired alternative is attained from which the nation would rise purer and stronger.

In exploring the fundamental divide in the politics of India and Pakistan, I often think back to the 300 years of the Mughal Empire. Half this period was dominated by the six Great Mughals whom everyone recognizes. The other half was populated by dozens of emperors most of whom few can recall. This was the period dominated by behind-the-scene king-makers who shuffled puppet emperors at will, retaining them only for the legitimacy they conferred.

This could explain how democratic India and Pakistan both remain overwhelmingly dynastic and yet on different political trajectories. I am tempted to conclude that Indian politics is a continuation of the first half of the Mughal Empire while Pakistani politics resembles more the second – the rule of kings versus that of king-makers.

Of course, in the age of democracy kings don’t rule till they die or are deposed – they can take turns in office. From the viewpoint of incentives it makes a huge behavioral difference if a leader knows he has to remain at home when out of power as opposed to one prepared to flee abroad to seek a patron.

These contrasting imperatives, incentives, and strategies have led to divergent political trajectories in Pakistan and India and thereby to the different fate of their citizens – the one ignored, the other appeased.

The first completion of the political term of a civilian government in Pakistan could signal a change. Constraining further the power of king-makers could bend the Pakistani trajectory towards the Indian model, itself a variant of the Downs prototype. When that happens, Pakistani citizens would attain parity with their Indian peers. It would make little difference in their immediate conditions but place them on a better political platform for the long struggle ahead.

Anjum Altaf is Dean of the School of Humanities and Social Sciences at the Lahore University of Management Sciences. He would like to thank Nadeem ul Haque for discussions on this topic. This op-ed appeared in Dawn on August 27, 2013 and is reproduced here with permission of the author.

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4 Responses to “What Governments Do and Why”

This article brings very interesting insights to politics in Pakistan. This includes the parallels between the two periods of Mughal dynasty and the situation between India and Pakistan. I agree with the analysis, which is based upon factual evidence. The only hope for us seems to be that with the voter becoming more enlightened and the civilian governments remaining in the driving seat, accompanied with a system of accountability/checks and balances– an important part of working democracies– the situation might improve. However, in the short term the prospects do not appear to be bright. Perhaps several rounds of elections are required before our system becomes more mature.

One reason the Turkish civilian government has been able to assert its control is because of good governance. I think the same is required in Pakistan. The question is whether it is the right kind of leadership that brings in good governance and then makes it sustainable through the development of institutions or the other way round. Rationally, it would appear that institutional development is a pre-requisite for good governance. I would be interested in hearing your opinion in the context of Pakistan on this issue.